UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event Reported): June 4, 2018

CDK Global, Inc.
(Exact Name of Registrant as Specified in Charter)

Delaware
(State or Other Jurisdiction of Incorporation)

1-36486
46-5743146
(Commission File Number)
(I.R.S. Employer Identification Number)

1950 Hassell Road, Hoffman Estates, IL 60169
(Registrant's telephone number, including area code)
 
(847) 397-1700
(Registrant's Telephone Number, Including Area Code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
[ ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
[ ]
Emerging growth company
 
[ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.




Item 7.01          Regulation FD Disclosure.

On June 4, 2018, CDK Global, Inc. (the “Company”) issued a press release announcing the commencement of a registered public offering of $500,000,000 aggregate principal amount of senior unsecured notes (the “Offering”).  The press release regarding the Offering is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

The Company is also disclosing the information attached to this report as Exhibit 99.2, which is incorporated by reference herein.

This report does not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale of any security in any jurisdiction in which such offering, solicitation or sale would be unlawful.

The information in this Item 7.01 and Exhibit 99.1 and Exhibit 99.2 hereto is furnished solely pursuant to Item 7.01 of this Form 8-K. Consequently, it is not deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) or otherwise subject to the liabilities of that section. It may only be incorporated by reference in another filing under the Exchange Act or Securities Act of 1933, as amended, if such subsequent filing specifically references this Form 8-K.

Item 9.01          Financial Statements and Exhibits.

(d)
Exhibits.

     
EXHIBIT NO.
 
DESCRIPTION
   
 
Press Release dated June 4, 2018, issued by the Company
 
Investor Presentation dated June 4, 2018



SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: June 4, 2018
CDK Global, Inc.
   
 
By:
/s/ Joseph A. Tautges
   
Joseph A. Tautges
   
Executive Vice President, Chief Financial Officer



Exhibit 99.1



CDK Global Announces Proposed Registered Offering of Senior Notes

HOFFMAN ESTATES, Ill., June 4, 2018 (GLOBE NEWSWIRE) -- CDK Global, Inc. (Nasdaq:CDK) announced today that it is commencing, subject to market and other conditions, a registered offering of $500 million aggregate principal amount of senior notes due 2026 (the “Notes”).  The Notes will be general unsecured obligations of CDK and will not be guaranteed by any of CDK’s subsidiaries. CDK intends to use the proceeds from the offering for general corporate purposes, which may include share repurchases, dividends, acquisitions, repayments of debt, and working capital and capital expenditures.

The offering is being made pursuant to the CDK’s automatic shelf registration statement on Form S-3 filed with the Securities and Exchange Commission (the “SEC”) on May 1, 2018, and pursuant to a preliminary prospectus supplement, which will also be filed with the SEC.

J.P. Morgan, BofA Merrill Lynch, Morgan Stanley, MUFG, US Bancorp and Wells Fargo Securities are acting as joint book-running managers in the offering.

A prospectus and prospectus supplement concerning the offering may be obtained from:

·
J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY, 11717 or by calling (866) 803-9204
·
Merrill Lynch, Pierce, Fenner & Smith Incorporated, One Bryant Park, New York, NY 10036
·
Morgan Stanley & Co. LLC, 1585 Broadway, New York NY 10036
·
MUFG Securities Americas Inc., 1221 Avenue of the Americas, 6th Floor, New York, NY 10020-1001
·
U.S. Bancorp Investments, Inc., 214 N. Tryon St., 26th Floor, Charlotte, NC 28202
·
Wells Fargo Securities, LLC, 550 South Tryon Street, Charlotte, NC 28202

This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities nor will there be any sales of the Notes in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About CDK Global

With more than $2 billion in revenues, CDK (Nasdaq:CDK) is a leading global provider of integrated information technology and digital marketing solutions to the automotive retail and adjacent industries. Focused on enabling end-to-end automotive commerce, CDK Global provides solutions to dealers in more than 100 countries around the world, serving approximately 28,000 retail locations and most automotive manufacturers. CDK solutions automate and integrate all parts of the dealership and buying process from targeted digital advertising and marketing campaigns to the sale, financing, insuring, parts supply, repair and maintenance of vehicles. Visit cdkglobal.com.



Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, including statements about CDK’s future expectations, beliefs, goals, plans or prospects may be forward looking statements. Words such as “might,” “will,” “may,” “could,” “should,” “estimates,” “expects,” “continues,” “contemplates,” “anticipates,” “projects,” “plans,” “potential,” “predicts,” “intends,” “believes,” “forecasts,” “future,” “assumes,” and variations of such words or similar expressions are intended to identify forward-looking statements. These statements are based on management's expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed, or implied by, these forward-looking statements. Factors that could cause actual results to differ materially from those contemplated by the forward-looking statements include: CDK’s success in obtaining, retaining and selling additional services to customers; the pricing of products and services; overall market and economic conditions, including interest rate and foreign currency trends, and technology trends; adverse global economic conditions and credit markets and volatility in the countries in which we do business; auto sales and advertising and related industry changes; competitive conditions; changes in regulation (including future interpretations, assumptions and regulatory guidance related to the Tax Cuts and Jobs Act); changes in technology, security breaches, interruptions, failures and other errors involving CDK systems; availability of skilled technical employees/labor/personnel; the impact of new acquisitions and divestitures; employment and wage levels; availability of capital for the payment of debt service obligations or dividends or the repurchase of shares; any changes to CDK’s credit ratings and the impact of such changes on financing costs, rates, terms, debt service obligations, access to capital market and working capital needs; the impact of CDK’s indebtedness, access to cash and financing, and ability to secure financing, or financing at attractive rates; litigation involving contract, intellectual property, competition, shareholder, and other matters, and governmental investigations; CDK’s ability to timely and effectively implement its transformation plan; and the ability of the CDK’s significant stockholders and their affiliates to significantly influence the CDK’s decisions or cause it to incur significant costs.

There may be other factors that may cause CDK’s actual results, performance or achievements to differ materially from those expressed in, or implied by, the forward-looking statements. CDK gives no assurances that any of the events anticipated by the forward-looking statements will occur or, if any of them do, what impact they will have on its results of operations and financial condition. You should carefully read the factors described in CDK’s reports filed with the Securities and Exchange Commission (“SEC”), including those discussed under “Part I, Item 1A. Risk Factors” in its most recent Annual Report on Form 10-K and its most recent Quarterly Report on Form 10-Q for a description of certain risks that could, among other things, cause CDK’s actual results to differ from any forward-looking statements contained herein. These filings can be found on the CDK website at www.cdkglobal.com and the SEC’s website at www.sec.gov.

All forward-looking statements speak only as of the date of this press release even if subsequently made available by CDK on its website or otherwise. CDK disclaims any obligation to update or revise any forward-looking statements that may be made to reflect new information or future events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events, other than as required by law.

Investor Relations Contact:
Katie Coleman
847.485.4650
katherine.coleman@cdk.com

Media Contact:
Roxanne Pipitone
Roxanne.pipitone@cdk.com
 


Exhibit 99.2
 June 2018  CDK Global Investor Presentation 
 

 Safe harbor for forward-looking statements  This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, including: the Company’s business outlook, forecasted GAAP and adjusted results for the fiscal year ending June 30, 2018, and an estimated post-tax reform normalized annual adjusted effective tax rate; the Company’s objectives for its multi-year business transformation plan; other plans; objectives; forecasts; goals; beliefs; business strategies; future events; business conditions; results of operations; financial position and business outlook and trends; and other information, may be forward-looking statements. Words such as "might," "will," "may," "could," "should," "estimates," "expects," "continues," "contemplates," "anticipates," "projects," "plans," "potential," "predicts," "intends," "believes," "forecasts," "future," "assumes," and variations of such words or similar expressions are intended to identify forward-looking statements. These statements are based on management's expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed, or implied by, these forward-looking statements. Factors that could cause actual results to differ materially from those contemplated by the forward-looking statements include: the Company’s success in obtaining, retaining and selling additional services to customers; the pricing of products and services; overall market and economic conditions, including interest rate and foreign currency trends, and technology trends; adverse global economic conditions and credit markets and volatility in the countries in which we do business; auto sales and advertising and related industry changes; competitive conditions; changes in regulation (including future interpretations, assumptions and regulatory guidance related to the Tax Cuts and Jobs Act); changes in technology, security breaches, interruptions, failures and other errors involving CDK systems; availability of skilled technical employees/labor/personnel; the impact of new acquisitions and divestitures; employment and wage levels; availability of capital for the payment of debt service obligations or dividends or the repurchase of shares; any changes to the Company’s credit ratings and the impact of such changes on financing costs, rates, terms, debt service obligations, access to capital market and working capital needs; the impact of the Company’s indebtedness, access to cash and financing, and ability to secure financing, or financing at attractive rates; litigation involving contract, intellectual property, competition, shareholder, and other matters, and governmental investigations; the Company’s ability to timely and effectively implement its transformation plan; and the ability of the Company’s significant stockholders and their affiliates to significantly influence the Company’s decisions or cause it to incur significant costs. There may be other factors that may cause the Company’s actual results, performance or achievements to differ materially from those expressed in, or implied by, the forward-looking statements. CDK gives no assurances that any of the events anticipated by the forward-looking statements will occur or, if any of them do, what impact they will have on its results of operations and financial condition. You should carefully read the factors described in the Company’s reports filed with the Securities and Exchange Commission ("SEC"), including those discussed under "Part I, Item 1A. Risk Factors" in its most recent Annual Report on Form 10-K and its most recent Quarterly Report on Form 10-Q for a description of certain risks that could, among other things, cause the Company’s actual results to differ from any forward-looking statements contained herein. These filings can be found on the CDK website at www.cdkglobal.com and the SEC's website at www.sec.gov. All forward-looking statements speak only as of the date of this press release even if subsequently made available by CDK on its website or otherwise. CDK disclaims any obligation to update or revise any forward-looking statements that may be made to reflect new information or future events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events, other than as required by law. 
 

 Agenda  Company overviewMarket landscapeSegment overviewsBusiness highlights Financial performanceAppendix 
 

 Company overview 
 

 CDK Global purpose statement  CDK enables end-to-end automotive commerce.We do this by powering an open platform and integrating capabilities to increase sales, operational efficiency, and profitability for dealers. 
 

 CDK overview  Retail Solutions North America (RSNA)$1,601M(72% of total revenue)  CDK International (CDKI)$312M(14% of total revenue)  Advertising North America (ANA)$307M(14% of total revenue)  Retail Solutions  Advertising  Leadership position in the North America marketEnables over 13 million vehicle sales in the U.S.83 million monthly visitors across CDK and partner websites  Customers in over 100 countriesLeader in premium end-to-end DMS market   Integration with retail solutions provides competitive advantage  Market leadership  Segment  Automotive retailers using ‘core DMS’7 of 10 largest U.S. auto dealer groups26 of the top 30 dealer groups in the UKOEMs – Original Equipment Manufacturers e.g. GM, Ford, NissanOther application service and information providers – 350 partners offering 450 applications in North America  Automotive retailersLocal marketing associations (LMAs)OEM  Customers  CDK platform drives the auto industry  Annual US auto commerce on platform  Annual US repair orders enabled  Digital ad impressions per month  Daily secured data volume moved  Global DMS sites  Employees  $500B (2% of US GDP)  134M  1B  2TB  28K  9K  Note: Company financials as of fiscal 2017  TBU 
 

 CDK solutions address the demands of the entire automotive industry  Transaction flow  OEMs  Dealers  Consumers  Discovery / comparisonsGetting the best priceCustomer experience for buying a carService warranty  Sales / marketingService / supportCost efficiency  Brand / marketingSales volumeOEM parts / serviceUnderstanding consumers dataConsistent business processes  Key priorities  CDK opportunities  Core DMS  Layered applicationsTransactionsWebsitesData servicesDigital advertisingLife time value (LTV) service and support    CDK solutions  Core DMS  Layered applications  Transactions  Websites  Data services  Adjacencies  Digital advertising 
 

  Minimal exposure to auto sales; <10% of overall revenue   Deeply embedded in dealer operations, but just ~2% of dealership total cost structure1  ~28,000 DMS sites in US and abroad  ~3-5 year average terms  20 year average tenure  70% recurring revenue with 90%+ retention rate  CDK business model is attractive with high recurring revenues and long-term relationships, ensuring resiliency of current business  Mission critical, low % of dealer costs  Transaction pricing  Highly diversified customers  Contract based business  Loyal customers  Highly recurring revenue  Note: Company financials1 CDK average revenue per dealership as a percentage of light vehicle dealership average operating cost; 2017 NADA report 
 

 Leadership team  x  Number of years with CDK  2  Brian MacDonaldChief Executive Officer  14  Lee BrunzEVP & General Counsel  <1  Joe TautgesEVP & CFO  1  Ron FreyEVP & Chief Global Strategy Officer  2  Dan FlynnPresident, CDK North America  16  Scott MathewsEVP, NA Sales  2  Dean CrutchfieldEVP & Chief Information Officer  <1  Amy ByrneEVP & CHRO  5  Neil PackhamPresident, CDK International  4  Rajiv AmarEVP & CTO 
 

 Highly predictable recurring revenue   Solid revenue growth, outperforms U.S. Auto Seasonally Adjusted Annual Rate   Approximately 70% of revenue is subscription based  Total Subscription  6.1% CAGR  0.6% CAGR  Note:Industry data from IHS Markit; FY07–FY10 revenue per ADP Annual Report; FY11– FY13 per CDK Annual Report on Form 10 (June 30, 2015); FY14 – FY17 per CDK Annual Report  Note: Company filings  Amounts shown in millions of dollars (actual rate) 
 

 Disciplined vendor management and vendor consolidation, leveraging business scale  Reducing business complexity through integrated go-to-market model that leverages an automated contracting process, SKU rationalization, and streamline invoicing  Streamlined installation and training process through improved technology, process and workflow, resulting in a 40% reduction in cycle times in several areas as of Q4 FY17 Significant opportunities still exist to reduce process time and hand-offs  Average monthly auto revenue per North American and International site up 8.7% and 7.3% respectively in FY17 year over year  Closed 20 facilities to date, including 7 facilities in FY17 Q4Exceeded original target of 18 closures by FY18  Reduced number of software versions to under 400 from 1,500Exceeded Q4 FY17 target of 500 versions  Continued focus on and improvement of customer service metrics90% reduction in average wait time over chat over previous year180% of service requests routed through chat2 (Service Connect)  CDK is successfully executing its business transformation that began in May 2015  Continued excellence on customer service  MoveUp! / software version rationalization  Workforce efficiency and footprint consolidation  Increased penetration of customer base and improved pricing / packaging  Streamline implementation  Simplify quote to cash  Strategic sourcing  Note: Company filings1 September 2017 over February 20162 As of September 2017  
 

 Our business transformation will continue to deliver significant margin improvement  Note: 1 See appendix for reconciliation of non-GAAP to GAAP financial measures including adjusted EBITDA  Adjusted EBITDA growth1          +$400MTotal FY15 – FY19  Adjusted EBITDA margin expansion1        ~1,300 bpsTotal FY15 ‒ FY1835% - 36%FY18  Adjusted EBITDA exit margin1  36% - 38%Q4 FY1840%+Q4 FY19  Net earnings attributable to CDK margin expansion1        ~700bpsTotal FY15 ‒ FY1816% - 17%FY18 
 

 Additional opportunities for margin expansion   Initiatives launched to drive adj. EBTIDA margin  Software version rationalizationWorkforce efficiency and footprint consolidationIncreased penetration of customer baseStreamlined implementation  Initiatives planned to further drive adj. EBITDA margin  Workforce optimization through spans and layers, automation and offshore mixThird-party spend reduction in hardware, software and contract laborG&A and indirect spend reduction  Fiscal years ended June 30  Note: Company filings1 See appendix for reconciliation of non-GAAP to GAAP financial measures including adjusted EBITDA  Amounts shown in millions of dollars 
 

 Market landscape 
 

 CDK provides a leading end-to-end automotive commerce platform and is strongly positioned to take advantage of an evolving market  Market evolution creating new opportunities    Consumers: Demanding omnichannel coverage and more modern experienceOEMs: Influencing technology purchasing decisions as they strive for control of customer experienceDealers: Adopting advanced technology features; under pressure to improve cost structureVehicles: Technology changing at rapid pace with telematics and autonomous driving coming to life  Each business segment well organized to grow    Retail Solutions: Augment leading market position improving win/loss ratio, layered app penetrationDigital marketing: Further increase advertising penetration, especially direct to dealersInternational: Make inroads by enabling third party integration and leveraging digital offering 
 

         Niche providers  DMS          Parts/Service          Finance          CRM          Inventory          Internet Marketing          Competitors vary from workflow to niche providers 
 

   Our vision  “Go-to” technology partner for dealers and OEMs    Global product scale and efficiencies    “Best-in-class” customer success    Software-like financial profile    CDK – epicenter of the automotive ecosystem   
 

 Product innovation  Drive Flex DMSaaS  Innovative cloud-based DMS product focused on smaller dealershipsVariable pricing structure that allows dealer to match DMS expense to seasonal and OEM-specific cycles in their businessPotential first step in modernizing CDK’s broader technology backbone  Fortellis Automotive Commerce Exchange  Open technology platform focused on automotive commerceAllows for the development and integration of APIs to foster innovation and improve dealer workflowOpportunity for CDK to componentize and monetize technology Access to developers and APIs will also help CDK improve its produces and speed development  
 

 Segment overviews 
 

 Retail Solutions North America  Strategic situation  CDK is a leader in the large automotive tech market with ~14.6K sites (9.1K auto and 5.5K adjacent) and loyal customersProvides a broad suite of solutions (Quoting, CRM, websites, aftermarket products, repair and maintenance, parts, etc.)  Strengths  Deep industry expertiseStrong financial/market positionStrong brand recognitionGood presence in mid/upper dealer market  Strong enterprise accounts and OEM relationshipsChannel, support/install scaleDiversified portfolio  Key stats (FY17)  $1,601M revenue  37.8% EBT margin  14.6Ksites  $5.6Kmonthly rev/site  Customer base  7 of 10 largest U.S. auto dealer groups2/3 of auto sites are 3+ store (rooftop) dealer groups1/3 of auto sites are 1-2 store (rooftop) dealer groups Adjacent market includes recreation (motorcycle, marine, RV), heavy truck, and heavy equipment  
 

 Overview of RSNA products    Subscription revenuesCore DMS: Fundamental dealer management system, flexible solution for streamlining businessLayered apps: Apps such as Document Management and CDK Service which enable end-to-end solutionWebsites: Provide customer website solutions, integrating connected store, etc.Data Services: Provide value-added DMS data integrationsAdjacencies: Provide DMS solutions to the truck, recreational, and heavy equipment retailersTransaction revenuesProvide computerized vehicle registration and credit check servicesOther revenuesConsulting, hardware, and other consumables revenue   RSNA products  9,081 auto sites  5,530 adjacency sites  6,879websites  FY17 key metrics  350partners 
 

   RSNA layered applications      Document management    Network & telephony    Core front office(CRM, Desking, Menu)    Service    Inventory    Websites 
 

 Advertising North America  Strategic situation  Incumbent DMS and Automotive Retail Solutions providers developing proprietary solutionsProgram management intermediaries growing in popularity with OEMsLarge fragmented advertising industryCompetition along breadth of features, functionality, scalability, and service capability  Strengths  Proprietary adtech platform designed for automotive retail industry that dynamically adjusts content, spend, and bidding across multiple channelsProprietary analytic models with high predictive value for OEM customersIntegrated solutions linking ad spend by OEMs through to dealer groupsOne of the largest purchasers of automotive retail ad inventory  Key stats (FY17)  $307M revenue  14.4% EBT margin  Note: Excludes Service and Parts ad spend 
 

 ANA ecosystem      6,879websites  CDK DMS customers  Rest of the market    OEM endorsements    Dealer-direct advertising (T3)  LMA  OEM network      Local marketing associations 
 

 CDK International  Strategic situation  Large market with 4 key playersCurrent disruptions in automotive industry are creating revenue pressures and new technology needsOEM’s exert significant market influence  Strengths  Strong brand for DMSRobust and reliable solutionsAttractive for partnersOEM relationships  Large dealer customer baseAutomotive expertiseOEM responsivenessCDKI structure supports OEM consolidation  Key stats (FY17)  $312M revenue  24.0% EBT margin  13.5Ksites  $1.2Kmonthly rev/site  Revenue distribution 
 

 Business highlights 
 

 Key credit highlights  Global leader in growing business  Long-term, highlyembedded customer relationships  Diversified geographic footprint  Highly recurring revenue model  Low capital requirements and strong free cash flow  Resilient business model even during downturn  Unparalleled global footprint with broad capabilities and expertiseTop industry innovator across entire suite of solutionsBalanced growth strategySignificantly expanding margins; accelerating earnings growthEnhancing market leadership in auto retail IT market  Mission critical solutions for customers, resulting in long-standing client relationshipsCustomers have an average retention of 20 years  Clients in 100+ countriesApproximately 14% of total revenue is generated outside of North AmericaImproving global economic environment provides tail wind for future growth outside North America  Recurring revenue supported by multi-year contracts with high renewal ratesSubscription revenue made up approximately 80% of revenue in Retail Solutions North America, or approximately 70% of total revenue  Strong and expanding adjusted EBITDA margin and low capital requirements drive strong free cash flow generation$486M cash flows from operating activities1 as of LTM Q3 FY2018$398M of free cash flow1 as of LTM Q3 FY2018  CDK revenue declined 10% peak to trough during the global financial crisis (FY2008-FY2010) despite multiple OEM bankruptcies, 3000 North American dealership closures and a reduction of more than 40% in U.S. Seasonally Adjusted Annual Rate of vehicle sales3  1  2  3  4  5  6  Note:1 Free cash flow is cash flows from operating activities less capital expenditures and capitalized software; see appendix for reconciliation of non-GAAP to GAAP financial measures; free cash flows does not represent the residual cash flow available for discretionary expenditures; 2 See appendix for reconciliation of non-GAAP to GAAP financial measures including adjusted EBITDA; 3 Bureau of Economic Analysis (BEA) May 31, 2018 report  15.0% net earnings attributable to CDK margin2 in LTM Q3 FY201834.8% adjusted EBITDA margin2 in LTM Q3 FY2018~$300M of target costs savings enhances free cash flow profile 
 

 Global leader in growing business     Global automotive sales are increasingOEMs and large dealer groups looking for global partnersAccelerating shift to digital marketingConvergence of online and in store experienceMigration to integrated retail workflow-based solutionsGrowing adoption of data-based analyticsOmnichannel coverage demand increasing  Market growth drivers   Significant auto retail IT spendLarge and growing digital marketing spend  Global opportunities  1 
 

 Long-term highly embedded customer relationships  Note: Company filings1 Based on FY18 Q3 company data    Retail SolutionsNorth America  CDKInternational  Advertising  OEMframework  Limited  Often  High  Number of sites1  14,530(6,801 websites)  13,537  N/A  Average monthlyrevenue per site1  $5,836  $1,310   N/A  Typicalcontract length  5-yr contract  3-yr contract  1 – 3-yr contract  Sample clients(all publicly-heldcompanies)        Owned by Tata Group  Customers have an average retention of 20 years  2 
 

 Broad geographic footprint  CDK’s industry depth, breadth and domain expertise is unmatched in the marketplace                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        3    CDK coverage 
 

 High recurring revenue  Fiscal years ended June 30  Revenue breakdown by type  Subscription revenue made up approximately 70% of total revenue;recurring revenue supported by multi-year contracts with high renewal rates  $2,115  $2,220  $2,269    4  FY2017  Note: Company filings  Amounts shown in millions of dollars 
 

 % of GAAP revenue  3%   3%  4%  4%  Low capital requirements  Fiscal years ended June 30    Capital expenditures and capitalized software  $64  $94  $88  Cash flows from operating activities1  $64  5  % of GAAP revenue  13%   15%  19%  21%  Note: Company filings1 See appendix for reconciliation of non-GAAP to GAAP financial measures  Amounts shown in millions of dollars 
 

 Flat revenue in 2010 versus 2007, despite a 30% reduction in U.S. Auto SAAR  Strong resilience through market cycles  Fiscal years ended June 30  Through the cycle revenue performance1  Amounts shown in millions of dollars  2009 – 2010 GM and Chrysler bankruptcy resulted in closure of 3,000 sites  Units (millions)  Global recession  6  Note:1 Industry data from IHS Markit; FY07 – FY10 revenue per ADP Annual Report; FY11 – FY13 per CDK Annual Report on Form 10 (June 30, 2015); FY14 – FY17 per CDK Annual Report 
 

 Financial performance 
 

 Conservative financial policy  $755M return of capital1 in CY2017; Q3 2018 gross leverage of 2.7x  $750M - $1B return of capital2 expected in CY2018 & CY2019  Publically committed to leverage targets and reduction of capital returns in the event of material M&A  Note: Company filings1 Dividends plus share repurchases, including shares repurchased in the calendar year but not settled; 2 Dividends plus share repurchases  Continue measured progress to target financial leverage of 2.5x – 3.0x net debt to adjusted EBITDA 
 

 Financial performance over time  Fiscal years ended June 30  Revenue1  Adjusted EBITDA2  Solid results demonstrate management’s ability to execute against business transformation plan  4.4% CAGR  Adj. EBITDA margin2  Note: Company filings1 Adjusted revenue excludes the Internet Sales Leads business divested on May 21, 2015; see appendix for reconciliation of non-GAAP to GAAP financial measures;2 See Appendix for reconciliation of non-GAAP to GAAP financial measures including adjusted EBITDA  21.5% CAGR  Net earnings attributable to CDK2  Net earnings attributable to CDK margin2  26.5% CAGR  Adjusted revenue1  3.5% CAGR  Amounts shown in millions of dollars 
 

 Leverage and free cash flow over time  Fiscal years ended June 30  Leverage (total debt1 / adj. EBITDA2)  Cash flows from operating activities3  Note: Company filings1 Total debt and capital lease obligations excluding unamortized debt financing costs;2 See appendix for reconciliation of non-GAAP to GAAP financial measures including adjusted EBITDA;3 Free cash flow is cash flows from operating activities less capital expenditures and capitalized software; see appendix for reconciliation of non-GAAP to GAAP financial measures; free cash flows does not represent the residual cash flow available for discretionary expenditures  Free cash flow3  Amounts shown in millions of dollars 
 

 Uses of cash  Capital expenditures and capitalizedsoftware  Acquisitions  Shareholderdistributions  Capital expenditures and capitalized software expected to remain within 3-4% of revenue  Continue to invest in strategic acquisitionsFlex leverage ratio to provide M&A capacity as needed, but restrict buybacks to return to target ratio  Since the spin-off, CDK has returned (as of 3/31/18)Total dividends = ~$282MTotal share repurchases = $1,749M  Capital expenditures and capitalized software  Net acquisitions  Dividends  Share repurchases  Note: Company filings  Amounts shown in millions of dollars  Fiscal years ended June 30 
 

 Q3 2018 earnings highlights    GAAP  Adjusted  Revenue  $577  $577   Growth  4%  4%  Earnings before income taxes  $135  $167   Growth  22%  12%  Adjusted EBITDA  -  $210   Margin  -  36%  Net earnings attributable to CDK  $96  $116   Growth  24%  17%  Diluted net earnings attributable to CDK per share  $0.71  $0.85   Growth  34%  27%  Note: Company filings  Amounts shown in millions of dollars, except per share amounts 
 

 Fiscal 2018 guidance    Guidance as of Q3’18      GAAP  Adjusted  Revenue growth  2.5% - 3.0%  2.5% - 3.0%  Diluted net earnings attributable to CDK per share  $2.67 ‒ $2.72  $3.23 ‒ $3.28  Growth  34.0% - 37.0%  25.0% - 27.0%  Growth  Net earnings attributable to CDK   EBITDA     24.0% - 27.0%  13.0% - 16.0%  Margin  Net earnings attributable to CDK  EBITDA    16.0% - 17.0%  35.5% - 36.0%high end of range  Effective tax rate   25% – 26%  29% – 30%In fiscal 2019, expect further 3-4% reduction  Note: Company filings 
 

 Appendix 
 

 Glossary of non-GAAP measures  Within this presentation, we disclose certain financial measures for our consolidated and operating segment results on both a GAAP and a non-GAAP (adjusted) basis. The non-GAAP financial measures disclosed should be viewed in addition to, and not as an alternative to, results prepared in accordance with GAAP. Our use of each of the following non-GAAP financial measures may differ from similarly titled non-GAAP financial measures presented by other companies, and other companies may not define these non-GAAP financial measures, or reconcile them to the comparable GAAP financial measures, in the same way. A reconciliation between the following non-GAAP measures and their most comparable GAAP measure and an explanation of why management believes the non-GAAP measures are useful for both management and investors can be found below.   Non-GAAP Financial Measure  Comparable GAAP Financial Measure  Adjusted revenue  Revenue  Adjusted EBITDA  Net earnings attributable to CDK  Adjusted EBITDA margin  Net earnings attributable to CDK margin  Free cash flow  Cash flows from operating activities  We use adjusted revenue, adjusted EBITDA and adjusted EBITDA margin internally to evaluate our performance on a consistent basis, because the measures adjust for the impact of certain items that we believe do not directly reflect our underlying operations. By adjusting for these items we believe we have more precise inputs for use as factors in (i) our budgeting process, (ii) making financial and operational decisions, (iii) evaluating ongoing segment and overall operating performance on a consistent period-to-period basis, (iv) target leverage calculations, (v) debt covenant calculations, and (vi) determining incentive-based compensation. Our business transformation plan adjusted EBITDA growth and adjusted EBITDA exit margin targets represent financial objectives distinct from forecasts of performance. Therefore, we have not provided a reconciliations of these targets to the most directly comparable GAAP measure of net earnings attributable to CDK, because projecting potential adjustments to GAAP results for these target is not practical and could be misleading to users of this financial information. The adjusted EBITDA reconciliation disclosed in this Appendix is indicative of the reconciliations that will be prepared for the same adjusted measures in the future. 
 

 Non-GAAP reconciliations                    FY 2015  FY 2016  FY 2017  Q3 2018  LTM Q3 2018  Revenue    $2,064  $2,115  $2,220  $577  $2,269   Internet sales leads revenues1    (46)  -  -  -  -  Adjusted revenue    $2,017  $2,115  $2,220  $577  $2,269                    FY 2015  FY 2016  FY 2017  Q3 2018  LTM Q3 2018  Cash flows from operating activities    $268  $320  $431  $191  $486   Capital expenditures    (44)  (51)  (62)  (9)   (52)   Capitalized software    (20)  (13)  (32)  (10)  (36)  Free cash flow2    $204  $256  $337  $172  $398  Note: Company filings1 Elimination of revenues related to the internet sales leads business, which was part of the RSNA segment and was sold on May 21, 2015;2 We review free cash flow to measure our ability to generate additional cash from our business operations. Free cash flow is defined as cash flows from operating activities less amounts paid for capital expenditures and capitalized software. Our definition of free cash flow is limited, in that it does not represent the residual cash flow available for discretionary expenditures due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions. Therefore, free cash flow should be considered in addition to, rather than as a substitute for consolidated net income as a measure of our performance and net cash provided by operating activities as a measure of our liquidity  Amounts shown in millions of dollars 
 

 Non-GAAP reconciliations  Amounts shown in millions of dollars  FY 2015  FY 2016  FY 2017  Q3 2018  LTM Q3 2018  Net earnings attributable to CDK  $178.4  $239.3  $295.6  $96.1  $340.1   % margin  8.6%  11.3%  13.3%  16.7%  15.0%   Net earnings attributable to non-controlling interest 1  7.9  7.5  6.9  1.7  7.9   Provision for income taxes2  113.6  122.3  132.8  37.2  121.2   Interest expense3  28.8  40.2  57.2  24.1  89.7   Depreciation and amortization4  76.5  64.0  70.3  19.6  76.9   Total stock-based compensation5  30.4  36.4  55.4  6.9  51.0   Restructuring expenses6  2.4  20.2  18.4  2.5  24.7   Other business transformation expenses7  1.9  34.8  75.6  10.4  58.6   Acquisition and integration-related expenses8  -  -  0.7  9.5  13.9   Officer transition expense9  -  -  0.7  -  1.3   Legal and regulatory expenses10  -  -  -  2.4  5.4   Tax matters indemnification gain, net11  1.1  (2.6)  -  -  (0.4)   Internet sales leads earnings12  (2.5)  -  -  -  -   Separation costs13  34.6  -  -  -  -   Stand-alone public company costs14  (16.8)  -  -  -  -   Trademark royalty fee15  5.7  -  -  -  -  Adjusted EBITDA  $462.0  $562.1  $713.6  $210.4  $790.3   % margin  22.9%  26.6%  32.1%  36.5%  34.8%    1 Net earnings attributable to noncontrolling interest included within the financial statements for the periods presented; 2 Provision for income taxes included within the financial statements for the periods presented; 3 Interest expense included within the financial statements for the periods presented; 4 Depreciation and amortization included within the financial statements for the periods presented, including the accelerated amortization attributable to the Cobalt trademark recognized during fiscal 2015; 5 Total stock-based compensation expense recognized for the periods presented; 6 Restructuring expense recognized in connection with our business transformation plan; 7 Other business transformation expenses are included within cost of revenues and selling, general and administrative expenses and were incurred in connection with our business transformation plan in the periods presented; 8 Acquisition and integration-related expenses include legal, accounting, other professional fees, and other integration costs incurred in connection with assessment and integration of acquisitions and were included within selling, general and administrative expenses; 9 Officer transition expense includes severance expense in connection with officer departures is included within selling, general and administrative expenses for the periods presented; 10 Legal and regulatory expenses related to competition matters recognized for the periods presented were included within selling, general and administrative expenses; 11 Net (gain)/loss recorded within other income, net associated with an indemnification receivable from ADP or liability to ADP for pre spin-off tax periods in accordance with the tax matters agreement; 12 Elimination of earnings before income taxes related to the internet sales leads business. Earnings before income taxes related to the internet sales leads business includes the loss recognized on the sale of $0.8 million in FY2015; 13 Incremental costs incurred in FY2015 that were directly attributable to the spin-off from ADP; 14 Incremental costs associated with the formation of corporate departments as a stand-alone public company. These costs were incurred in fiscal 2016 and have been reflected as adjustments in FY2015 to present all periods on a comparable basis; 15 Elimination of the royalty paid to ADP for the utilization of the ADP trademark during FY2015 prior to the spin-off from ADP, as there was no comparable royalty after the spin-off